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Significant Tenant

6 Months Ended

Jun. 30, 2012

Note 10. Significant Tenant

Five Star is our former subsidiary and RMR provides management services to both us and Five Star. Rental income from Five Star represented 40.3% of our annualized rental income and the properties Five Star leases from us represent 44.5% of our investments, at cost, as of June 30, 2012. As of June 30, 2012, Five Star also manages a portfolio of 24 senior living communities for our account. These properties leased and managed by Five Star are included in our short and long term residential care communities segment. The following tables present summary financial information for Five Star for the three and six months ended June 30, 2012 and 2011, as reported in its Quarterly Report on Form 10-Q.

	For the Three Months Ended June 30,
Operations	2012		2011
Total revenues	$	349,094	$	311,884
Operating income	6,611		8,072
Income from continuing operations	4,931		5,987
Net income	4,638		5,196

	For the Six Months Ended June 30,
	2012		2011
Total revenues	$	695,215	$	619,500
Operating income	9,124		14,531
Income from continuing operations	5,677		11,896
Net income	5,007		9,329

	For the Six Months Ended June 30,
Cash Flows	2012			2011
Cash provided by operating activities	$	30,748		$	31,445
Net cash used in discontinued operations	(316		)	(2,365		)
Cash used in investing activities	(22,057		)	(69,354		)
Cash (used in) provided by financing activities	(13,114		)	62,662
Change in cash and cash equivalents	(4,739		)	22,388
Cash and cash equivalents at beginning of period	28,374			20,770
Cash and cash equivalents at end of period	23,635			43,158

	As of June 30,
Financial Position	2012		2011
Current assets	$	138,739	$	160,156
Non-current assets	442,946		321,395
Total indebtedness	109,226		73,975
Current liabilities	195,735		160,174
Non-current liabilities	99,981		91,748
Total shareholders’ equity	285,969		229,629

The summary financial information of Five Star is presented to comply with applicable accounting regulations of the Securities and Exchange Commission, or SEC. References in these financial statements to the Quarterly Report on Form 10-Q for Five Star are included to show the source of the information only, and the information in Five Star’s Quarterly Report on Form 10-Q is not incorporated by reference into these financial statements. See Note 11 for further information regarding our leases with Five Star.